This is the next installment in our series spotlighting the different ways communities across North Carolina are tackling their housing needs.
Here, we are highlighting an idea being implemented by our friends in the Town of Chapel Hill that expedites the review timeline for projects that contain affordable housing.
The idea
To incentivize the production of affordable housing in Chapel Hill, the Town has implemented an expedited review process for some projects seeking conditional zoning approval. The expedited review process is available for projects that include at least 25% affordable housing. Rental projects must offer affordable units to households earning 60% or less of the Area Median Income (AMI) and home ownership projects must offer affordable units to households earning 80% or less of AMI.
The Town revised its conditional zoning process for projects with affordable housing by eliminating some steps in the standard review process and simplifying others. For example, the Town’s conditional rezoning procedures generally require a project to go before the Town Council at least twice- once for a legislative hearing and again for Council action. However, the procedures now allow the Council to act on a conditional rezoning with affordable housing during the same meeting at which it conducts the legislative hearing. This revision eliminates a step in the process (an additional Council meeting) which speeds up the rezoning process. The Town further expedites these projects through the removal of a requirement for affordable housing projects to go before the community design commission.
The Town also took steps to simplify the rezoning application for affordable housing projects. For the Council to approve an affordable project, it must find that the application shows the project can feasibly conform with the Town’s land use requirements, including stormwater management. This is different than the Council’s requirement to find that the project does conform with the land use requirements which is the standard for all other rezonings. This slight change can allow projects to move through the review process at an earlier stage of project development thereby reducing the time it takes a developer to get approval for their project and thus some of their carrying and other costs.
The result of these changes is a conditional rezoning application review timeline of roughly six months for projects with substantial affordable housing components. This is significantly shorter than the12-18 months it can take for other rezoning applications in Chapel Hill. The Town successfully utilized the expedited review process for the first time 2024. Using this process, one particular affordable housing project went through the Town’s process in only 4 months total, a substantial reduction from the typical timeline.
Why we like it
We think this approach is notable because it makes the Town more attractive to affordable housing development without any direct cost to the Town.
It also increases the predictability of the process. Developers don’t like uncertainty– Finding out in 4-6 months that your project can or cannot move forward, as opposed to waiting 18 months, makes it easier for developers to plan and budget their projects, both in Town and not.
It can reduce a developer’s carrying costs. The upfront soft costs to developers (e.g., architectural fees, legal expenses, and interest payments on loans) while they wait for their plans to be reviewed by local governments can be a substantial part of the total cost of a development. Reducing the review time and potential number of plan changes removes some of these costs.
Other communities looking for low-cost or free ways to incentivize affordable housing can review their existing zoning process and look for ways to reduce steps in the process or otherwise simplify the application. Perhaps you require two hearings for rezonings- consider the purpose for each and whether they can be combined or eliminated altogether.
Let us know if you’re interested in discussing this idea further or if you’d like our help in setting up a similar program or exploring funding mechanisms for affordable housing.
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